Capesize rates have reached $30,000 per day, virtually doubling in May, says an article published in Splash.
Report plenty of new cargoes
Several additional cargoes are expected to arrive in the Pacific today, according to brokers, with India being particularly aggressive in its coal delivery.
The Baltic Dry Index (BDI) is currently nearing 3,000 points, indicating that capes are finally catching up to their smaller dry bulk siblings in terms of spot profits.
Furthermore, a look at June forward freight agreements, which are currently trading at $39,000 per day, suggests capes have a lot of room to grow in the coming weeks.
Futures market versus
“The Capesize market has finally showed signs of strength, with spot rates doubling over the past few weeks, catching up to what in hindsight was an accurate futures market versus one that at that time seemed way too optimistic,” stated a new report from New York-based Breakwave Advisors.
Backhaul patterns
“Big pulls are now coming from both the West and the East, with Owners sending their ships away in all directions, confounding traditional fronthaul and backhaul patterns. Europe continues to drive coal imports from as far away as Australia, but India is taking up the competition, all the while as the market is seeing more requirements from China of iron ore coming out of Brazil. This is as exciting as it gets,” a recent report from Norwegian brokers Lorentzen & Co stated.
Seasonality in bulker market
“I keep repeating to myself, ‘Correlation does not equal causation’ but then I keep looking at this chart of IMF inflation data and the Baltic Dry Index, then I think about seasonality in bulker markets, which typically means they rise from May to October,” Williams wrote in a social media post.
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Source: Splash
